21 Life Hacks From Warren Buffett That Anyone Can Use
21 Life Hacks From Warren Buffett That Anyone Can Use
Ashley Redmond Fri, October 15, 2021
You don't get to be one of the richest people in the world without knowing something the rest of us don't. Often referred to as the Oracle of Omaha, Warren Buffett has a net worth of $102.2 billion, according to Forbes.
While Buffett is unquestionably a genius when it comes to business, his words of wisdom aren't just good for finding a hot investment. In fact, there are many Warren Buffett tips that anyone can use.
Learn how you can apply Buffett's tips and hack your way to a wealthier life.
1. Decide That You’re Going To Be Rich
In order to be rich, you have to believe that one day you will be. According to the Huffington Post, Buffett once reportedly said, "I always knew I was going to be rich. I don't think I ever doubted it for a minute."
21 Life Hacks From Warren Buffett That Anyone Can Use
Ashley Redmond Fri, October 15, 2021
You don't get to be one of the richest people in the world without knowing something the rest of us don't. Often referred to as the Oracle of Omaha, Warren Buffett has a net worth of $102.2 billion, according to Forbes.
While Buffett is unquestionably a genius when it comes to business, his words of wisdom aren't just good for finding a hot investment. In fact, there are many Warren Buffett tips that anyone can use.
Learn how you can apply Buffett's tips and hack your way to a wealthier life.
1. Decide That You’re Going To Be Rich
In order to be rich, you have to believe that one day you will be. According to the Huffington Post, Buffett once reportedly said, "I always knew I was going to be rich. I don't think I ever doubted it for a minute."
For best results, set high expectations for yourself and work toward your goals and aspirations.
"Then, make it clear to yourself, your family and friends that you have a commitment to become financially independent," said Randall "Dolph" Janis, an insurance agent at Clear Income Strategies Group. "Create your future with a plan, knowing when to get aggressive against knowing when to be conservative."
2. Start Saving at a Young Age
By age 15, Warren Buffett had earned $2,000 delivering papers and selling magazine subscriptions, according to CNBC. He used $1,200 of his earnings to invest in a farm, forming a profit-sharing agreement with the farmer.
The lesson? "Start saving money as early as possible, so that you get into the habit," said Brittney Castro, founder and CEO of Financially Wise Women.
This is important whether you're saving to invest in a business or buy your first house.
To continue reading, please go to the original article here:
https://finance.yahoo.com/news/21-life-hacks-warren-buffett-163004663.html
What To Do if You Lose Your Wallet
.What To Do if You Lose Your Wallet
Sam DiSalvo Fri, October 15, 2021
We’ve all been there: that pang of anxiety when you can’t find your wallet. Maybe you left it somewhere. Maybe it was stolen. Either way, it’s gone and you need to figure out what to do next. Take a deep breath. All is not lost. There are some key steps you can take to start recovering what you need to.
Notify Your Bank & Credit Card Companies
Do this immediately upon realizing you lost your wallet. If you wait more than 24 hours, you might have to pay for charges you didn’t make. Often, the first thing thieves will do is start seeing if they can put your cards to use. Notifying your bank and credit card companies immediately stops that at the pass, and ensures you won’t be on the hook for any of their charges.
What To Do if You Lose Your Wallet
Sam DiSalvo Fri, October 15, 2021
We’ve all been there: that pang of anxiety when you can’t find your wallet. Maybe you left it somewhere. Maybe it was stolen. Either way, it’s gone and you need to figure out what to do next. Take a deep breath. All is not lost. There are some key steps you can take to start recovering what you need to.
Notify Your Bank & Credit Card Companies
Do this immediately upon realizing you lost your wallet. If you wait more than 24 hours, you might have to pay for charges you didn’t make. Often, the first thing thieves will do is start seeing if they can put your cards to use. Notifying your bank and credit card companies immediately stops that at the pass, and ensures you won’t be on the hook for any of their charges.
Banks and credit card companies will go through the past few charges to confirm they’re yours or mark them as unrecognized so you don’t have to pay for them. After that, they’ll start the process to get you a new card.
Even if you end up finding your card, the only inconvenience is a brief wait for a new card, something that’s much more tolerable than what could happen if thieves started making purchases.
Get a New Driver’s License or Identification Card
Driving without a license can get you a ticket if you’re pulled over, not to mention all the other inconveniences that come up if you’re caught without your ID. Depending on your state, you’ll most likely have to go to the DMV to replace your ID. Bring your social security card (provided it wasn’t in your wallet), birth certificate and some proof of residency, like a utility bill. Some states will charge you to replace the license, but others will waive the fee if you can prove it was stolen with a police report.
Replace Your Social Security Card
If you had your social security card in your wallet, you’ll want to act as soon as possible. If a thief has your social security card, they can open new credit card accounts, so you’ll want to get a credit freeze with Equifax, Experian, and TransUnion to ensure no credit cards are opened right away. This might cost a fee between $2-10.
The Social Security Administration will issue you a new card, but won’t issue you a new social security number unless you can prove you were a victim of identity theft. In the future, keep your social security card in a safe place at home, rather than in your wallet.
To continue reading, please go to the original article here:
Here's When The IRS Can Check Out My Bank Account
.Here's When The IRS Can Check Out My Bank Account
Rick Newman ·Senior Columnist Wed, October 13
Let’s say I hire a contractor to do a project on my house, and he asks for payment in cash. It would be cheaper than if I wrote a check, and we both know why: Cash leaves less of a paper trail and the contractor might not report it as income. If he doesn’t have to pay income tax on the money, he’ll share some of the savings with me.
This type of gray-market transaction happens all the time, every day. Parents pay babysitters and nannies in cash. Waiters earning tips report a fraction of what they take home as taxable income. People selling used cars slash hundreds or thousands off the agreed price on the bill of sale they submit to the state, so the buyer pays less in sales tax.
Here's When The IRS Can Check Out My Bank Account
Rick Newman ·Senior Columnist Wed, October 13
Let’s say I hire a contractor to do a project on my house, and he asks for payment in cash. It would be cheaper than if I wrote a check, and we both know why: Cash leaves less of a paper trail and the contractor might not report it as income. If he doesn’t have to pay income tax on the money, he’ll share some of the savings with me.
This type of gray-market transaction happens all the time, every day. Parents pay babysitters and nannies in cash. Waiters earning tips report a fraction of what they take home as taxable income. People selling used cars slash hundreds or thousands off the agreed price on the bill of sale they submit to the state, so the buyer pays less in sales tax.
Stay ahead of the market
The Biden administration wants Congress to give the IRS authority to look in people’s bank accounts as a tool for helping find tax cheats. The premise is solid: Massive tax avoidance robs the Treasury of as much as $280 billion per year, with wealthy evaders dodging the most in taxes. One recent study found the top 1% of earners underreport their income by 21%. Matching bank records with tax filings and other documents the IRS already has would help identify who’s hiding money, and where.
WASHINGTON, DC - JUNE 08: Sen. Rob Portman (R-OH) greets Charles P. Rettig, commissioner of the Internal Revenue Service during a Senate Finance Committee hearing June 8, 2021 on Capitol Hill in Washington, D.C. The committee is hearing testimony on the IRS budget request for 2022. (Photo by Tom Williams-Pool/Getty Images)
Sen. Rob Portman (R-OH) greets Charles P. Rettig, commissioner of the Internal Revenue Service during a Senate Finance Committee hearing June 8, 2021 on Capitol Hill in Washington, D.C. The committee is hearing testimony on the IRS budget request for 2022. (Photo by Tom Williams-Pool/Getty Images)
Reeling in more of the tax revenue evaders already owe might restore some sense of fairness to a system many think is rigged in favor of the wealthy. Democrats with slight majorities in both houses of Congress also need new revenue to pay for a broad package of social-welfare and green-energy programs they want to pass by the end of the year. President Biden says an extra $80 billion in enforcement funding over a decade could help the IRS collect an extra $700 billion in taxes Americans already owe. That would be 900% return on investment. If the return is only one-third that, it would still be a bargain.
In practice, however, the prospect of more IRS snooping into Americans’ finances is an off-the-shelf outrage generator. Anti-government sentiment is near historic highs. The spread of disinformation is too. Toss in a little demagoguery, and social-media trolls will have half the country thinking the IRS is stealing money from their bank accounts. The Treasury Department says IRS bank reviews would target the wealthy, not lower- or middle-income families. But the scaremongering practically whips itself up.
The original plan was for the IRS to monitor accounts with balances of more than $600, which is meant to filter out inactive accounts or those held by kids. That threshold is way too low. Democrats drafting legislation are considering raising the cutoff to $10,000, but $100,000 or even $1 million might be a better limit.
To continue reading, please go to the original article here:
https://finance.yahoo.com/news/heres-when-the-irs-can-check-out-my-bank-account-115143383.html
Why Does The Government Want to Know How Much is in Your Bank Account?
.Why Does The Government Want to Know How Much is in Your Bank Account?
Vance Cariaga Thu, October 14, 2021,
If you’re concerned that the U.S. government wants to monitor your bank account, you’re not alone. Plenty of lawmakers, consumers and banking trade groups are pushing back against the idea, which was proposed in May by the Treasury Department as part of its budget request.
But the government has its reasons for such a proposal, and they mainly have to do with President Joe Biden’s desire to crack down on unpaid taxes, mostly from wealthy Americans and big businesses. Those unpaid taxes total about $7 trillion, The New York Times reported, and the Biden administration wants that money to help fund social and economic programs.
Why Does The Government Want to Know How Much is in Your Bank Account?
Vance Cariaga Thu, October 14, 2021,
If you’re concerned that the U.S. government wants to monitor your bank account, you’re not alone. Plenty of lawmakers, consumers and banking trade groups are pushing back against the idea, which was proposed in May by the Treasury Department as part of its budget request.
But the government has its reasons for such a proposal, and they mainly have to do with President Joe Biden’s desire to crack down on unpaid taxes, mostly from wealthy Americans and big businesses. Those unpaid taxes total about $7 trillion, The New York Times reported, and the Biden administration wants that money to help fund social and economic programs.
Under the Treasury Department’s proposal, banks would be required to note how much money goes into and out of bank accounts, with the exception of accounts that have less than $600 of inflows a year, or whose balances are below $600, CBS News reported. No individual transactions would be listed, and Treasury officials insist such a plan would not lead to more audits of middle-income Americans.
But banks and their trade groups are not happy about the proposal, and they’re showing their displeasure by running advertising and letter-writing campaigns to raise awareness about it. This in turn has led to an avalanche of phone calls, emails and complaints from concerned personal and small-business account holders.
“We have heard a lot from our customers about their concerns about their privacy,” Jill Castilla, CEO of the single-branch Citizens Bank of Edmond in Oklahoma, told The New York Times. “I’ve gotten calls, emails, and then we’ve had many customers come in.”
To continue reading, please go to the original article here:
https://finance.yahoo.com/news/why-does-government-want-know-193640228.html
Fortify Your Finances Against Natural Disaster
.Fortify Your Finances Against Natural Disaster
Liz Weston of NerdWallet Mon, October 11, 2021,
Emergency preparedness experts recommend that you have a “go bag” and a “stay bin” for disasters: kits with supplies to help you survive a few days if you have to evacuate your home or shelter in place.
Preparing your finances for natural disasters is also smart. Having cash on hand, access to credit and the right insurance coverage can help you get through perilous times. Fortifying your home against disasters also can be a good investment. Not everyone can make these preparations, of course. People with the fewest resources often suffer the brunt of disasters. But anything you can do to bolster your situation now could help you limit the toll.
Fortify Your Finances Against Natural Disaster
Liz Weston of NerdWallet Mon, October 11, 2021,
Emergency preparedness experts recommend that you have a “go bag” and a “stay bin” for disasters: kits with supplies to help you survive a few days if you have to evacuate your home or shelter in place.
Preparing your finances for natural disasters is also smart. Having cash on hand, access to credit and the right insurance coverage can help you get through perilous times. Fortifying your home against disasters also can be a good investment. Not everyone can make these preparations, of course. People with the fewest resources often suffer the brunt of disasters. But anything you can do to bolster your situation now could help you limit the toll.
STASH SOME CASH
Having cash on hand could help you pay for groceries, gas, shelter and other necessities if ATMs and payment systems aren’t functioning, which could happen if the power goes out or cyberattacks knock systems offline.
You may need more than you think, especially if you’re away from your home for more than a few days. Insurance consumer advocate Amy Bach recommends keeping at least $2,000 in a safe place somewhere in your home. After a widespread disaster, there is often “incredible competition” for rentals and other lodging, and a cash deposit could help you secure a place to stay, says Bach, executive director of the nonprofit United Policyholders.
The currency should be in addition to any emergency savings you have at the bank. Again, anything is better than nothing. While financial planners typically recommend an emergency fund equal to three to six months of expenses, even a couple hundred dollars can help you cope.
GET SOME CREDIT
To continue reading, please go to the original article here:
https://www.yahoo.com/lifestyle/liz-weston-fortify-finances-against-104407489.html
An Unhealthy Obsession With Money
.An Unhealthy Obsession With Money
Posted October 6, 2021 by Ben Carlson
One hundred dollars invested in Berkshire Hathaway in 1965 would have grown to more than $2.8 million by the end of 2020. Warren Buffett’s holding company is the most impressive long-term compounding machine in history, increasing in market value at 20% per year for nearly 6 decades. Compounding is a wonderful thing but it can also become an unhealthy obsession if you view every financial decision through that lens.
In Buffett: The Making of an American Capitalist, Roger Lowenstein tells a story from Buffett’s friend and former business partner Katherine Graham when she was publisher of the Washington Post.
An Unhealthy Obsession With Money
Posted October 6, 2021 by Ben Carlson
One hundred dollars invested in Berkshire Hathaway in 1965 would have grown to more than $2.8 million by the end of 2020. Warren Buffett’s holding company is the most impressive long-term compounding machine in history, increasing in market value at 20% per year for nearly 6 decades. Compounding is a wonderful thing but it can also become an unhealthy obsession if you view every financial decision through that lens.
In Buffett: The Making of an American Capitalist, Roger Lowenstein tells a story from Buffett’s friend and former business partner Katherine Graham when she was publisher of the Washington Post.
Graham was in the airport with Buffett and needed to make a phone call from a payphone (remember those?). She asked Buffett for a dime (which was the going rate for a call at the time). Buffett grabbed a quarter from his pocket and walked off to get change from a cashier. Graham snapped at him, “Warren, give me the quarter!” Buffett was so stingy he wanted to give her exact change for the call and not a penny more.
There was another story from the book where Buffett complained to a friend about his wife purchasing $15k of new furniture for their home. He told the friend, “Do you know how much that is if you compound it over 20 years?”
I’m not going to defend extravagant furniture purchases but that’s not really the point. If you’re always worried about the future value of your money, it becomes much harder to enjoy the present value of your time.
Shelby Davis isn’t a household name like Buffett but his investing track record is almost as impressive.
Davis quit his job at age 38 in the late-1940s to become a full-time investor. His timing was impeccable as the stock market was about to enter one of the great bull markets of all-time. His timing was fortuitous but Davis was also a fantastic stock picker. Sticking mainly to insurance stocks, Davis managed to turn $50,000 in 1947 into $900 million by the time he passed away in 1994.1
Like Buffett, Davis was a compounding machine. Like Buffett, Davis came from the value investing school of Ben Graham. And like Buffett, Davis was noticeable cheap for being so rich.
Buffett scoffed at buying expensive furniture for his wife as he did the math in his head about lost future gains from compounding while Davis gave the exact same speech to his grandson…about a $1 hot dog. He refused to buy it for the boy. He also told his children they could only have a swimming pool if they dug the hole themselves.2 Those are relatively small things though. Once the sums became large enough, the money created a rift in the family.
In his book The Davis Dynasty, John Rothchild recounts a fight between Davis and his daughter that made it into the pages of the New York Daily News in the early-1960s:
In the early 1940s, he funded each account with $4,000-surely not a sum that would sap anybody’s future self-reliance. By 1961, as the New York Daily News reported, each “$4,000 acorn had grown into a $3.8 million oak.”
To continue reading, please go to the original article here:
https://awealthofcommonsense.com/2021/10/an-unhealthy-obsession-with-money/
The End Of Physical Currency, Cash, Is Certainly Drawing Near': Economist
.The End Of Physical Currency, Cash, Is Certainly Drawing Near': Economist
Ihsaan Fanusie Thu, October 7, 2021
In this article: Eswar Prasad American economist
Physical currency and hard cash may soon be a thing of the past, Eswar Prasad, Cornell University economics professor and author of "The Future of Money" told Yahoo Finance Live.
“The end of physical currency, cash, is certainly drawing near, and cryptocurrencies, including bitcoin (BTC-USD), have certainly paved the way for that revolution,” Prasad said. The digitalization of transactions has been well underway for the past few decades, but serious discussions regarding a fully-digital dollar are relatively new.
The prospect of a central bank digital currency (CBDC) in the U.S. has gained traction in 2021, with the Fed reportedly planning to begin a review process of the costs and benefits associated with CBDCs as soon as next week.
The End Of Physical Currency, Cash, Is Certainly Drawing Near': Economist
Ihsaan Fanusie Thu, October 7, 2021
In this article: Eswar Prasad American economist
Physical currency and hard cash may soon be a thing of the past, Eswar Prasad, Cornell University economics professor and author of "The Future of Money" told Yahoo Finance Live.
“The end of physical currency, cash, is certainly drawing near, and cryptocurrencies, including bitcoin (BTC-USD), have certainly paved the way for that revolution,” Prasad said. The digitalization of transactions has been well underway for the past few decades, but serious discussions regarding a fully-digital dollar are relatively new.
The prospect of a central bank digital currency (CBDC) in the U.S. has gained traction in 2021, with the Fed reportedly planning to begin a review process of the costs and benefits associated with CBDCs as soon as next week.
While the chances of adopting a digital currency within the near future are slim, digital payments have grown exponentially within the past few years, giving credence to the notion that the U.S. is moving towards a digital economy.
But it is unlikely that cryptocurrencies will become the dominant form of payments in the future, Prasad says, because of their inherent volatility. Stablecoins like those pegged to fiat currencies, however, may become more widespread as the digital economy evolves.
“My own view is that cryptocurrencies may not ultimately prove to be viable mediums of exchange,” he said. “Especially the decentralized ones like crypto coins that have very volatile value and that have a number of other impediments. But they've already given rise to stablecoins, whose value is backed by reserves of hard currency, such as the U.S. dollar and U.S. dollar securities, which could provide more efficient payment transactions.”
Digital currency or cash: 'The objective is financial inclusion'
Government-backed digital currency could be an egalitarian benefit to a thriving private sector by allowing for greater financial inclusion, Prasad said. "Banking the unbanked" has been a popular goal for enthusiasts of digital currencies and other fintech.
The internet has brought to the regular person many financial tools historically available exclusively to professionals, enthusiasts say, and new developments in financial technology have given these people greater leverage and control in their finances.
To continue reading, please go to the original article here:
https://news.yahoo.com/cryptocurrencies-paved-the-way-for-the-end-of-cash-economist-145549693.html
Social Security Card and 4 Other Things You Should Never Keep in Your Wallet
.Social Security Card and 4 Other Things You Should Never Keep in Your Wallet
Cameron Huddleston Wed, October 6, 2021
Years ago, while I was at a crowded outdoor market, someone reached into my purse and plucked my credit card and debit card from my wallet. I didn’t even know they were missing until I got home and discovered a message on my answering machine from my card company, alerting me that there had been suspicious activity on my account.
I quickly canceled my cards, contested the fraudulent charges and recovered — without a financial loss — from the incident. However, I consider myself fortunate. The situation might have been far worse if I’d been carrying other things in my wallet — items that could have created a financial nightmare for me if thieves had gotten their hands on them.
Social Security Card and 4 Other Things You Should Never Keep in Your Wallet
Cameron Huddleston Wed, October 6, 2021
Years ago, while I was at a crowded outdoor market, someone reached into my purse and plucked my credit card and debit card from my wallet. I didn’t even know they were missing until I got home and discovered a message on my answering machine from my card company, alerting me that there had been suspicious activity on my account.
I quickly canceled my cards, contested the fraudulent charges and recovered — without a financial loss — from the incident. However, I consider myself fortunate. The situation might have been far worse if I’d been carrying other things in my wallet — items that could have created a financial nightmare for me if thieves had gotten their hands on them.
Although large data breaches like the recent one at credit reporting agency Equifax tend to grab headlines, more than 40 percent of identity fraud cases stem from a stolen or lost wallet or purse, according to claim data from insurance company Travelers. So, if you’re carrying around these things in your wallet, you’re likely putting your identity and finances at risk — learn how to protect yourself.
1. Social Security Card
The No. 1 thing you should never carry in your wallet is your Social Security card.
“Your Social Security number is the most vital piece of information for identity thieves, and the damage resulting from identity theft can impact your finances for years to come,” said Michael Bruemmer, vice president of consumer protection at Experian.
If someone gets your number, he or she can use it to apply for credit in your name, file a tax return and claim a refund or get a job and earn income that’s reported to the IRS — which will create problems for you at tax time, according to the Social Security Administration. For these reasons, Bruemmer says that losing a Social Security card can be devastating. It takes a lot of hard work for tax scam victims to clear their names with the IRS.
While you can get a new Social Security number, you must have evidence that someone is using your current one. However, some government agencies and businesses, such as banks, might still associate you with the old number — even after you make the switch.
2. Birth Certificate or Passport
To continue reading, please go to the original article here:
https://news.yahoo.com/social-security-card-4-other-200851869.html
How To Become A Billionaire… Even If It Takes 200 Years
.How To Become A Billionaire… Even If It Takes 200 Years
Notes From The Field By Simon Black October 6, 2021
It’s a simple question of arithmetic. Imagine you could go back in time to 1871 and ask one of your long lost ancestors to invest $2,500 for the benefit of future generations.
That amount of money wasn’t insignificant… but certainly not a major fortune; it would be worth roughly $50,000 in today’s money.
When placed in the right structure, and benefiting from compounding returns over the next 150 years, that $2,500 initial investment would be worth an astounding $1.4 BILLION today.
How To Become A Billionaire… Even If It Takes 200 Years
Notes From The Field By Simon Black October 6, 2021
It’s a simple question of arithmetic. Imagine you could go back in time to 1871 and ask one of your long lost ancestors to invest $2,500 for the benefit of future generations.
That amount of money wasn’t insignificant… but certainly not a major fortune; it would be worth roughly $50,000 in today’s money.
When placed in the right structure, and benefiting from compounding returns over the next 150 years, that $2,500 initial investment would be worth an astounding $1.4 BILLION today.
Now, sadly none of us owns a time machine. But we do have the power to be that long lost ancestor to future generations.
In other words, there’s little stopping you from setting aside some savings in a long-term structure-- like a trust, or even a smart contract-- that could have an enormous impact on the future.
$50,000 invested in the right structure today at, say, a 10% compounding return, will be worth $73 billion in 150 years.
Granted we’ll all most likely be long gone by then. And inflation will definitely have eaten up a large chunk of that return.
But it’s still going to be an enormous amount of money. And with the right planning, you have the power to decide, today, how that money will be spent and allocated in the future.
If you wanted to, you could leave behind strict instructions (which are legally binding) to have the assets liquidated at a certain point in the future, and donated to your favorite charity.
Or you could provide future trustees the discretion to make certain donations based on causes that are important to you today.
The point is that it’s possible to continue growing your wealth long after you’re gone, and to still exercise significant control over how it can impact the world and future generations.
This is the topic for today’s Freedom Podcast, which you can listen to here.
To your freedom, Simon Black, Founder, SovereignMan.com
Signs You’re Wealthier Than You Think
.Signs You’re Wealthier Than You Think
Cameron Huddleston Last updated: Oct. 4, 2021
When most think of wealth, they think about money," said Tom Corley, author of "Rich Habits" and "Change Your Habits, Change Your Life." "The thinking goes, the more money you have, the wealthier you are. But wealth is about much more than money." You might want to become the next Warren Buffett, but there's a good chance you already have more wealth than you realize.
See how and some of the steps you can take to start building more wealth today.
Signs You’re Wealthier Than You Think
Cameron Huddleston Last updated: Oct. 4, 2021
When most think of wealth, they think about money," said Tom Corley, author of "Rich Habits" and "Change Your Habits, Change Your Life." "The thinking goes, the more money you have, the wealthier you are. But wealth is about much more than money." You might want to become the next Warren Buffett, but there's a good chance you already have more wealth than you realize.
See how and some of the steps you can take to start building more wealth today.
Sign 1: Your Wealth Isn’t Defined by an Arbitrary Number
One of the main reasons many people don't realize how wealthy they are is because they compare themselves to others, said Michael Kay, author of "The Feel Rich Project" and president of Financial Life Focus. It's easy to assume someone is rich if you see him living in a big house, driving a nice car or belonging to a country club. But looks can be deceiving.
"You can't know what someone's true wealth is unless you're looking at their net worth statement," he said. For example, you might assume that, compared with an attorney and doctor, a mechanic isn't as well off, Kay said. But the mechanic might be the wealthiest because he's careful with his money and isn't trying to impress anyone with status symbols.
"At the end of the day, wealth is self-defined," he said. For example, if you say to yourself that you won't consider yourself wealthy until you have $5 million, ask why you've chosen that number.
Analysis
Instead of selecting an arbitrary measure of wealth, define what is important to you. Then, you can determine how much income and savings you need to have what you value. You might find that you're already on track to achieving what's important -- whether it's being able to retire at a certain age, work fewer hours, change jobs or take annual vacations.
"Wealth is all about finding what it truly is for you," Kay said. "Most people figure out it isn't about things."
Sign 2: You’re Not Weighed Down by Debt
To continue reading, please go to the original article here:
Dangerous Feelings
.Dangerous Feelings
Sep 30, 2021 by Morgan Housel
“I sat down at my fancy desk on the edge of my chair waiting for the market to open, ready to have another $50,000 day, and thinking life couldn’t get any better than this. This time, I was right. It didn’t.”
– Investor Jim Paul describing the moment he went from cocky and overconfident to broke and unemployed.
Success has a nasty tendency to increase confidence more than ability. The longer it lasts, and the more it was tied to some degree of serendipity, the truer that becomes.
It’s why getting rich and staying rich are different skills. And why most competitive advantages have a shelf life. Jason Zweig put it: “Being right is the enemy of staying right because it leads you to forget the way the world works.”
Dangerous Feelings
Sep 30, 2021 by Morgan Housel
“I sat down at my fancy desk on the edge of my chair waiting for the market to open, ready to have another $50,000 day, and thinking life couldn’t get any better than this. This time, I was right. It didn’t.”
– Investor Jim Paul describing the moment he went from cocky and overconfident to broke and unemployed.
Success has a nasty tendency to increase confidence more than ability. The longer it lasts, and the more it was tied to some degree of serendipity, the truer that becomes.
It’s why getting rich and staying rich are different skills. And why most competitive advantages have a shelf life. Jason Zweig put it: “Being right is the enemy of staying right because it leads you to forget the way the world works.”
It is of course possible to indefinitely maintain whatever skills brought you initial success. Lots of people and a handful of businesses have done it.
But when success is maintained for a long period the greatest skill often isn’t technical, or even specific to your trade. It’s identifying and resisting a few dangerous feelings that can nuzzle their way in after you’ve achieved any level of success.
A few of the big ones:
1. The decline of paranoia that made you successful to begin with.
A common irony goes like this:
Paranoia leads to success because it keeps you on your toes.
But paranoia is stressful, so you abandon it quickly once you achieve success.
Now you’ve abandoned what made you successful and you begin to decline – which is even more stressful.
It happens in business, investing, careers, relationships – all over the place.
Michael Moritz of Sequoia was once asked how his investment firm has thrived for 40 years. “We’ve always been afraid of going out of business,” was his answer.
It’s a rare response in a world where most successful people step back, take stock of all they’ve achieved, and assume they can not only breathe a sigh of relief but that their skills will run on autopilot.
A dangerous situation is when your goals (achieving enough success to relax) counter your skills (focus, paranoia, persistence). It hits you when you feel like past hard work entitles you to a break without realizing the cost of that break, however much it might be necessary and deserved. It’s part of why people who quit while they’re ahead are so admirable – it’s often not so much that they gave up, but that they’re aware of what made them successful and when that trait begins to wane.
2. Finding other peoples’ flaws more than you look for your own improvements.
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